JPMorgan Customers Sue Over Alleged Sweep Program Shortchanging

JPMorgan Chase & Co. is facing a proposed class action in federal court alleging that it breached its fiduciary duty to customers in its cash sweep program by not paying them sufficient interest on their deposits.

Dan Bodea sued JPMorgan and its subsidiary, J.P. Morgan Securities LLC, alleging that they are their customers’ agents and have fiduciary responsibilities when operating the sweep program. But JPMS used the sweep program “to confer outsized benefits upon itself and its affiliates,” according to his complaint filed in the US District Court for the Southern District of New York.

Cash sweep programs, which ...